"We've Never Seen this Before – Such a Huge Rally, and the Little Guy Is Out"

Vincent Deluard – a strategist for TrimTabs Investment Research (25% of the top 50 hedge funds in the world use TrimTabs’ research for market timing) – says:

We’ve never seen this before – such a huge rally, and the little guy is out.

In other words, the stock market rally is due to hedgies, pension funds, banks and other institutional investors, and not every day investors.

TrimTabs notes that small investors pulled out $14 billion net from stock mutual funds from the beginning of last year through mid-December, on top of a net $245 billion withdrawn in 2008.

Given that individuals held 80% of the $19 trillion in stock in U.S. companies, both private and public, at the end of September – according to the Federal Reserve – recovery will not happen so long as the little guys are sitting on the sidelines.

TrimTabs notes that most of $592 billion taken out of money market mutual funds last year has gone into bond and bond-hybrid funds instead.

No wonder David Rosenberg is saying:

“People have been lured into two bubbles seven years apart, and for a lot of them it’s over.”

“The bulls say if the market is up this much without retail investors, just watch when they come in, but it isn’t going to happen.”

Investors who have not been spooked or angered by the market are probably too poor to buy anyway.